how much can you transfer free of the estate tax?

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HOW MUCH CAN YOU TRANSFER FREE OF THE ESTATE TAX?

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HIGH NET WORTH INDIVIDUALS

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If you have been very successful from a financial

standpoint, you have to be concerned

about the estate tax.

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The estate tax carries a maximum rate of 40 percent.

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This tax can take a heavy toll on your financial legacy.

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MARITAL DEDUCTION

There is an unlimited marital estate tax deduction.

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You could use this deduction to transfer any amount of

property to your spouse free of the estate tax.

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However, to use this deduction, your spouse must be a citizen

of the United States.

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ESTATE TAX CREDIT OR EXCLUSION

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When it comes to transfers to people other than your spouse, you could use the

estate tax exclusion to transfer a certain amount tax-free.

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During the current calendar year, the federal estate tax exclusion is $5.45 million.

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INFLATION ADJUSTMENTS

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Each year, the estate tax exclusion can be adjusted to account for inflation, so you may see a somewhat larger

figure in 2017.

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PORTABILITY

The estate tax exclusion is portable between spouses.

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This means that a surviving spouse could use the exclusion that was allotted to his or her

deceased spouse.

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As a result, in 2016, a surviving spouse would have a total exclusion of $10.90 million.

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FEDERAL GIFT TAX

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You cannot give gifts while you are living to avoid the estate

tax, because there is a federal gift tax.

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The $5.45 million exclusion is a unified exclusion.

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It applies to your estate along with the large gifts that you give during your

life.

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In Maryland, there is an estate tax on the state level.

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The exclusion for the Maryland state estate tax is $2 million in

2016, $3 million in 2017, $4 million in 2018, and same as

the Federal exemption in 2019.

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INHERITANCE TAX

Maryland also has an inheritance tax.

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This tax is levied on transfers to each individual nonexempt

inheritor.

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WEALTH PRESERVATION CONSULTATION

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If you are concerned about how taxation can impact your

legacy, our firm can help.

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Contact us at (410) 573- 4818 to set up a consultation.

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Or visit our website www.sinclairprosserlaw.com

Nicole Livingston Jon J.

Gasior

Colleen SinclairProsser Victor A.

Lembo